As they watched the symbols of Saddam Hussein's regime come toppling down in Baghdad, government officials in Jerusalem were asking themselves what would happen right after the war. They girded themselves for a diplomatic battle, primarily over the American road map, and wondered whether President Bush would disappoint their hopes or instead continue to demonstrate leadership and determination in his struggle against the "axis of evil," and if he would understand that Palestinian terror is a key link in the worldwide chain of fundamentalist violence.

A few months before the penultimate hour in Iraq, high-level Israeli emissaries held talks with senior officials in the American administration, in which they tried to divine U.S. intentions for the post-Saddam era. The guests got the impression that Washington's ambitions meshed nicely with Israel's interest - that the U.S. meant to take the regime in Syria to task for the various ways in which it supports terrorism. Syria is where the headquarters of the Palestinian terror organizations, which issue the claims of responsibility for attacks perpetrated in Israel, are located. Bashar Assad allows Iranian arms to reach Hezbollah and he is perpetuating the situation that keeps the Lebanese government from deploying its army along the border with Israel, contrary to the agreement that led to the Israel Defense Forces withdrawal from Lebanon.

U.S. Defense Secretary Donald Rumsfeld's chastising remarks to Damascus during the war in Iraq were pleasing to Israeli ears: The defense establishment sees these comments as underscoring the understanding ostensibly reached between Jerusalem and Washington concerning the next target of American efforts to neutralize the loci of terror. Sources in Israel say that the Bush administration has put Syria on notice: The aid (in the form of volunteers, weapons and unrestricted movement) that Bashar Assad gave the Iraqi tyrant has been added to a debit column that already includes his involvement (along with Iran) in fanning the unrest in the Middle East.

The belief is that Assad only belatedly understood his situation and is now worried about America's intentions. The same goes for Hezbollah: It wasn't by chance that Sheikh Nasrallah described the American assault on Iraq as a threat to "the resistance" (i.e., to the right to use the terror weapon).

But alongside these omniscient assessments, which, as ever, contain more than a little wishful thinking, stands a small, but very concrete stumbling block: the American road map. This week, officials in Jerusalem held meetings to discuss how to prepare for a possible effort by the Bush administration soon to begin implementing the vision of an Israeli state and Palestinian state living side by side in peace. As usual, the expectation (if not the hope) in Israel was that this time as well, the Palestinians won't miss the opportunity to miss an opportunity to advance their national aspirations, and in so doing, will pull Israel's chestnuts out of the fire, too.

2. Who will govern the PA?

Six weeks before the start of the American campaign in Iraq, IDF leaders predicted that the war would help bring about a changing of the guard in the Palestinian leadership. As it turned out, even before the first American soldier crossed the border from Kuwait, Yasser Arafat agreed to accept the Quartet's dictate and to appoint Abu Mazen as prime minister. Another widely held view in the General Staff at the time was that the Palestinian street was fed up with Arafat and the disasters he'd wrought, so the new Palestinian leadership stood a good chance of neutralizing his influence. There appeared to be a greater likelihood that the new leadership would abandon the path of terror and steer the conflict with Israel onto the track of political bargaining.

Two months have since passed and the United States has brought about a change with historical implications for developments in the Middle East, but the longed-for changes on the Palestinian scene are not materializing quite so quickly. The timetable outlined by the road map did compel Arafat to acquiesce in Abu Mazen's appointment (to comply with the American call for governmental reform) before the start of the war, but as of now, the IDF's predictions that this process would lead to the end of Arafat's influence have not played out.

But a good number of the scenarios posited by IDF intelligence have actually come true: A competing leadership to Arafat has emerged, and according to Military Intelligence, this rival leadership has concluded that Arafat made a strategic mistake in opting for violence and so would prefer to conduct the debate with Israel at the negotiating table; Abu Mazen is (so far, at least) revealing himself to be capable of tenaciously withstanding Arafat's crafty attempts to diminish his authority; Mohammed Dahlan appears to be ready to impose the new leadership's authority on Hamas and Islamic Jihad (and on the radical groups in Fatah). The whole process itself is significant: A quiet revolution was carried out by an organized group that compelled Arafat - by means of a democratic proceeding in the Palestinian parliament - to create the post of prime minister, to appoint its representative to the post and to do so in accordance with the timing that it determined.

But one big hope has not been realized yet: the hope that Abu Mazen will be able to muster the necessary authority to achieve the objective that was at the basis of the entire undertaking - to force the terror organizations to accept the new government's authority and to leave Arafat with no more than figurehead status.

In the IDF's view, there are now three centers of power in the territories: Arafat, Abu Mazen (and the group around him) and the terror organizations (led by Hamas). A ferocious struggle for dominance is currently being waged among these three. Abu Mazen wants to form a government whose composition would facilitate his ambition of halting the terror and thereby pave the way for a cease-fire with Israel. He wants Dahlan for the job and refuses to accept Arafat's request to leave Hani al-Hassan in place (as interior minister).

Military intelligence believes that Dahlan is ready to take genuine action to rein in Hamas and Islamic Jihad because he understands that there is no hope for any kind of normal life within the PA territories as long as its leadership fails to control the militant organizations. Arafat thinks otherwise and so is opposed to Dahlan's appointment. The IDF believes that his struggle could be decided within days, and that the possibility that it could end with Abu Mazen's resignation cannot be ruled out.

3. Who will get rid of Arafat?

The Shin Bet security service has a different take on what is going on in the territories. For more than two years now, it has been arguing that the intifada did not erupt as a result of advance planning on Arafat's part, and it also refutes the contention that the Palestinian leader had control over the terror curve. The Shin Bet's view is drawn from its close contact with what's happening in the field, and it says that the violent Palestinian revolt originated from deep within the distressed population, and that this is borne out by information gleaned in interrogations of prisoners and terrorists. Arafat rode the wave of insurrection but did not manage it and quickly lost control of it. He gave encouragement to terror by not doing anything to stop it, but he did not direct it.

In the Shin Bet's view, Arafat's command, headed by Marwan Barghouti and Tawfiq Tirawi, was also more swept along by the street than the other way around. When Arafat tried - under Israeli and international pressure - to suppress the violence, he was unsuccessful because the militants weren't prepared to listen to him.

The Shin Bet sees the latest developments in the Palestinian leadership in a similar light: It feels that Abu Mazen intends to endow the prime minister's post with serious content, but Arafat is preventing him from doing so. Abu Mazen's efforts to put together a government of his choosing are not going smoothly, at least for now, because Arafat is trying to push him to appoint ministers that are more to his liking. In the Shin Bet, they are not sure that the new Palestinian prime minister will be able to overcome the will of the veteran Palestinian president. They even ask if Abu Mazen is really interested in putting Mohammed Dahlan in charge of security matters (as interior minister) because his militant attitude toward Hamas is not in sync with that of the prime minister. Still, the Shin Bet predicts that if Abu Mazen is able to obtain supreme responsibility for security matters, he will choose Dahlan because he needs the popular support that Dahlan enjoys in Gaza.

Like the IDF, the Shin Bet also believes that Arafat still has significant power to scuttle the reform process in the PA and the chance that it could lead to an easing of the conflict with Israel. Both are opposed to the idea of expelling Arafat or causing him physical harm. In the Shin Bet, they emphasize that removing Arafat from the territories will transform him once again into a star figure who is invited to visit world leaders, and will reinvigorate his symbolic standing as the unquestioned leader of the Palestinian people.

The Shin Bet's outlook is rather gloomy: Things cannot be expected to change very much. Whether or not Abu Mazen is able to form a government and whether or not he fails in this task or resigns, the situation in the territories will not be significantly altered. As long as Arafat is alive, there is no chance of instituting substantial changes in the functioning of the PA and its attitude toward Israel. In the West Bank, the PA has lost the ability to govern and in the Gaza Strip, it is wary of confronting Hamas. The war in Iraq did not seriously preoccupy the Palestinian leaders; they have been more focused on vying for their place in the new government. The road map will not fundamentally change the situation because Arafat will not permit a forceful confrontation with Hamas in order to impose the PA's authority. Therefore, any American mediation designed to alleviate the security situation cannot produce any concrete results: Abu Mazen does not have a solid plan of action (Military Intelligence presented the political echelon with a list of six principles that are supposedly guiding the Palestinian prime minister); he is still maneuvering and groping his way along.

Arafat, they agree in the Shin Bet, is no longer relevant to what is happening in the territories. He has lost the ability to influence what goes on, but he remains a symbol and as such, he is capable of eroding any initiative that seeks to compel the terror organizations to submit to another authority. The change will only come once Arafat makes a natural exit from the stage.

4. Who will pay the price?

The security agencies and the political echelon share the concern that the American administration will not adequately appreciate the real balance of forces in the Palestinian leadership, will point to the governmental reform that was ostensibly carried out and then demand that Israel do its part to ease the conflict, in accordance with the road map outline. Even if Abu Mazen manages to put together a government that more or less satisfies his expectations, and even if he reaches an understanding with Hamas on halting terror operations, Israel will contend that this is not enough: It will say that Abu Mazen must confront the terror organizations and vanquish them to the point of seeing them disarm.

In discussions held in Jerusalem in recent days, the possibility was considered that Abu Mazen could gain a semblance of control over events in the territories and thus fit into the American process that aspires first and foremost to achieve a cease-fire between Israel and the Palestinians. The IDF is recommending that the government not pay in hard currency for this development; it feels that in such a case, a gesture could be made to Abu Mazen that would take the form of easing the pressure on the Palestinian population and limited withdrawals from West Bank cities. In the view of the General Staff, a return of IDF forces to September 2000 lines can only take place if and when the armed Palestinian groups disarm completely, and only if there is a single security force in the territories that will faithfully obey the PA leadership.

The IDF says that Israel must insist that Hamas and Islamic Jihad (and other armed groups) be denied the ability to arm themselves, to manufacture weapons and to carry out attacks. In recent meetings, the chief of staff said that a cease-fire declaration that does not rest on these conditions would only create a pause that would enable the Palestinians to reorganize to continue their violent struggle against Israel.

Chief of Staff Moshe Ya'alon sees the Oslo Accords as a Trojan horse that brought Arafat to the territories and enhanced the Palestinians' ability to strike at Israel by means of murderous terrorism. In the same spirit, the IDF now says that it would be a grave demonstration of weakness if the government were to capitulate in the coming days to political pressure that seeks to restore the situation to what it was before the outbreak of the intifada. The chief of staff maintains that the Palestinians must pay the price for their betrayal of the Oslo Accords and that Israel must draw the right lessons from their conduct. He believes that the state must not fall again into the pit that Arafat dug for it 10 years ago and that it must thoroughly pursue the opportunity that the IDF has provided by quelling Palestinian terror.

The prevailing assessment among the General Staff is that Abu Mazen's generation has grasped the lesson of the intifada and come to the conclusion that the Palestinians must fight for their demands by means of political negotiations. In the IDF, they say that Israel should take advantage of this mood and not relent on its demand that the Palestinian leadership disarm the terror organizations.

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